After the somewhat surprising result of its recent referendum, with the UK voting to leave the European Union, uncertainty has taken over economic outlook for the country. The first signs of problem came with a close to 16% devaluation of the UK currency, sterling, while further repercussions have not yet materialized, the process of leaving the EU in reality has yet to begin. Noting that in other areas where the stability of the local fiat currency has been effected, in particular Greece and Venezuela, bitcoin exchange platform LocalBitcoins have just announced a halving of their purchase fee for all Bitcoins bought in the UK.
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Earlier this year the UK held a national referendum vote to determine whether the country remained within the European Union or not. The resulting vote to leave the EU, or Brexit as it has become known, has brought many possible consequences, with talk of recessions, a collapse of sterling, and widespread consequences within the EU as well. However, as we have seen in Greece and Venezuela, political uncertainty that also brings uncertainty within the money supply has had dramatic effects on digital currency use in those regions, and we may be getting a repeat of that in the United Kingdom.
Although the process of leaving the EU has barely begun, and is likely to take years, LocalBitcoins, the popular peer-to-peer bitcoin exchange platform, has taken a pro-active step in ensuring that it is ideally placed to take full advantage of any such uncertainty when it arrives. To do this, it has just announced a halving of its fees for all Bitcoin purchases made in the UK to just 0.5%, and while some may think this is a bit premature, this is not necessarily the case.
On the announcement of the referendum result to leave, sterling fell dramatically in value by close to 16%, and the likelihood of further falls as the process moves on and the ramifications become clearer are high. This move to encourage people to look more closely at Bitcoin is a clever move for both LocalBitcoins itself and the wider digital currency market. Increased use in Venezuela and Greece due to uncertainty in the fiat monetary systems were a good sign, but a repeat in the UK, one of the world’s major trading nations, would really make a statement about the viability of digital currencies.
From stagnation to recession, Japan to Spain, the fiat currency system is not coping well with the economic conditions around the world. The cryptocurrency industry is well placed to offer a genuine alternative, and should take every chance to push that idea to a wider audience as it can, and this action from LocalBitcoins is a great example of doing just that.